COMMENTARY

College, Inc.

June 18, 2010

DONALD E HELLER, The Pennsylvania State University

The for-profit, or proprietary sector of higher education has been in the news quite a bit recently. Frontline, the PBS investigative series, broadcast "College Inc." in April, which painted a less-than-flattering portrait of the sector. And then in the end of May, Steve Eisman of FrontPoint Financial Services Fund, an analyst featured in Michael Lewis's book The Big Short, spoke at the Ira Sohn Investment Research Conference. He was quoted as saying:

"Until recently, I thought that there would never again be an opportunity to be involved with an industry as socially destructive and morally bankrupt as the subprime mortgage industry," said Eisman. "I was wrong. The For-Profit Education Industry has proven equal to the task."

Pretty strong words from someone who supposedly has a good track record for reading markets and industries.

Mother Jones has a good recap of Eisman's perspective on the sector, and why he thinks it's ready for a tumble. He blames the Obama administration's push for gainful employment regulations, which would force the sector to demonstrate that graduates of their institutions make enough money to shoulder the higher debt burdens students there have on average (see the recent College Board report, Who Borrows Most? for more on this issue). READ MORE...

STATISTIC OF THE WEEK

Seven in ten adult internet users (69%) have used the internet to watch or download video. That represents 52% of all adults in the United States. Moreover, one in seven adult internet users (14%) have uploaded a video to the internet. Driven by the popularity of online video among 18-29 year-olds, there have been dramatic increases since 2007 in the number of American adults watching educational videos, which have risen in viewership from 22% to 38% of adult internet users.

THE NEWS

ACADEMIC PREPARATION

Studying engineering before they can spell itBy Winnie Hu, The New York Times
In a class full of aspiring engineers, the big bad wolf had to do more than just huff and puff to blow down the three little pigs’ house. To start, he needed to get past a voice-activated security gate, find a hidden door and negotiate a few other traps in a house that a pair of kindergartners here imagined for the pigs — and then pieced together from index cards, paper cups, wood sticks and pipe cleaners. All 300 students at Clara E. Coleman Elementary School are learning the A B C’s of engineering this year, even those who cannot yet spell e-n-g-i-n-e-e-r-i-n-g. The high-performing Glen Rock school district, about 22 miles northwest of Manhattan, now teaches 10 to 15 hours of engineering each year to every student in kindergarten through fifth grade, as part of a $100,000 redesign of the science curriculum.

Grade 3 students lagging on readingBy June Wu, The Boston Globe
Almost half of Massachusetts third-graders are not proficient readers, a sobering statistic in a new report that calls for an overhaul of reading programs across the state to reach children at an early age. The report, commissioned by the Boston-based Strategies for Children and scheduled to be released today, urges state educators and education policy-makers to refocus literacy efforts on improving language development skills, starting with toddlers, with the aim ofclosing achievement gaps between students of different socioeconomic backgrounds.

New paths to diploma possibleBy David White, The Charleston Gazette
Students at risk of dropping out could have new ways to earn a high school diploma or a GED diploma if state Board of Education members approve changes this summer. Debra Kimbler, state GED administrator, said the "very significant changes" introduce two new paths to reaching a high school diploma and one new path to a General Educational Development diploma. In all three cases, the students are expected to stay enrolled in school until they finish. Currently, students age 16 and 17 must be out of high school for at least one month and be considered a dropout before they can take the GED test. The policy revisions would change that.

POST SECONDARY ACCESS SUCCESS

ECS begins effort to systematically reduce remediationBy InsideHigerEd
The high degree of remedial work that students take in college is evidence of failure of the education system, and higher education leaders and policy makers must undertake a much more systematic effort to solve the problem, the Education Commission of the States argues in a new report. The paper, "Getting Past Go: Rebuilding the Remedial Education Bridge to College Success," helps begin a larger effort by the group to build a cohesive policy within and among states to build what are now often narrowly framed programs and innovations into wide-scale reforms.

Better educated work force needed for jobs in the near futureBy Joyce Jones, Diverse Education
If there’s one thing on which a majority of Americans can agree, it is that there aren’t enough jobs to go around these days. But if Americans don’t become better educated, they risk finding that the opposite will be true and that when the nation has fully recovered from the Great Recession, there won’t be enough qualified people to fill the number of available job opportunities. According to a report titled “Help Wanted: Projections of Jobs and Education Requirements Through 2018,” that the Georgetown University Center on Education and the Workforce released Tuesday, by 2018 there will be 46.8 million job openings, 63 percent of which will require some form of post-secondary education.

For-profit colleges projected to sharply increase their share of adult studentsBy Kelly Truong, The Chronicle of Higher Education
For-profit universities will have 42 percent of the adult-undergraduate market by 2019, nearly doubling their current share, according to a new study by the consulting company Eduventures. Last year approximately one-quarter of all adult undergraduates were enrolled at for-profit universities. The study projects that, in the next 10 years, for-profit institutions will increase their share of the adult market by 14 percentage points. By that time, for-profits will lead both public and private universities in the number of adults enrolled. They will have approximately 60,000 more adult students than will publics, and 800,000 more than privates.

INTERNATIONAL NEWS

Enrolment grows ahead of 2025 targetBy Bernard Lane, The Australian
Natural and physical sciences are among the fields to enjoy strong growth in demand as a top education official lends support to the view that the government's 2025 participation target will be reached early. Enrolments were expected to be up 9.9 per cent this year, and some universities were recruiting above the new, more relaxed 10 per cent cap on numbers, according to Colin Walters of the federal Education Department. Universities Australia chief Glenn Withers said some institutions appeared to be going for big growth early to position themselves for the coming years of better funding indexation.

Mexico’s Monterrey Tech pushes E-learning, as some worry it won’t solve the region’s burgeoning needBy Marion Lloyd, The Chronicle of Higher Education
A decade ago, only one in 50 Mexicans had access to the Internet. Today that figure is one in four, a staggering cultural transformation that is fueling a boom in online degree programs in the country. Few universities can rival the private Monterrey Institute of Technology and Higher Education when it comes to e-learning. Over the past two decades, the university, which has 33 campuses scattered across Mexico, has seized on the Internet revolution to boost enrollment and slash costs.

The ‘community college’ internationallyBy Elizabeth Redden, InsideHigherEd
Jorge Perez, a professor of mathematics, first encountered a community college when he came to the United States from Chile in 1980. Perez, who teaches at LaGuardia Community College, of the City University of New York, became such a believer of the mission of community colleges that he brokered a connection between a former student of his, who is now a dean at a Chilean university, and LaGuardia’s leadership, leading to the founding of the new Community College de Santiago this spring.

REPORTS WORTH READING

Minorities and the Recession-Era College Enrollment Boom
The recession-era boom in the size of freshman classes at four-year colleges, community colleges and trade schools has been driven largely by a sharp increase in minority student enrollment, according to a Pew Research Center analysis of new data from the U.S. Department of Education. The report examines the surge of minority enrollment in postsecondary institutions from 2007-2008. The report indicates that minority college students tend to be clustered more at community colleges and trade schools than at four-year colleges. Even so, the minority freshman enrollment spike from 2007 to 2008 occurred at all basic levels of post-secondary education.

Rebalancing the Mission: The Community College Completion Challenge
President Barack Obama has set forth an ambitious agenda for U.S. postsecondary education: by 2020, to once again have the highest proportion of college graduates in the world. In April 2010, the American Association of Community Colleges and five other community college organizations responded by reaffirming their commitment to completion while maintaining their commitment to increasing access and quality. With this commitment to completion articulated, Rebalancing the Mission: The Community College Completion Challenge addresses what it means for community colleges to embrace completion in the same way that they have historically embraced access.